Without money’s place in society, we would still be swapping items with other people, but only with individuals who are in need of the specific items we have; to make things worse, most individuals willing to trade for our items don’t have anything we really want. While capitalism certainly has its downsides, money is one of the greatest, most convenient things to ever happen to humankind.
Monetary policy refers to everything that government agencies responsible for issuing currencies do to maintain the value of such currency, prevent inflation, stave off deflation, and otherwise make sure their currency supplies are operating as planned, scheduled, and expected.
The United States Federal Reserve Bank, for example, strives to keep a certain amount of currency out in circulation at all times. By changing the interest rate at which people and entities can borrow money at, more or fewer people will engage in such government-related transactions; this effectively controls the money supply.
If it weren’t for strong monetary policy, the United States Dollar wouldn’t be worth more than its weight in toilet paper
The United States Federal Reserve Bank is the agency responsible for issuing currency in the United States mainland, Hawaii, Alaska, and its various territories (e.g. Guam, Puerto Rico).
Whenever the Federal Reserve Bank as an entity makes an announcement, news media circles across the United States instantaneously pick up articles, videos, broadcasts, and general concern as related to what such changes to monetary policy could do to the economy.
Earlier this year, Federal Reserve Bank Chairman Jerome Powell shared that he and his expert economists of colleagues felt that the year would need to host five full-fledged increases in interest rates. Thus far, the “Fed” – that’s what a majority of people refer to the Federal Reserve Bank as.
Jerome Powell pushed the interest rate to borrow money from the Federal Reserve Bank up to 1.75 percent from 1.5 percent – the latter was set the previous year on December 13 – on March 21. Just last month, on June 13, the interest rate to borrow money through the Fed was upped a quarter-point to 2 percent.
Here’s the brand-new news about the Fed, straight from Jerome Powell’s mouth
As of mid-year – right now – Powell and the Fed have two rate hikes planned for 2018 and three planned for 2019. Powell and company think that – at least as years go on – interest rate increases will not be necessary following the five planned hikes. That’s good news for the American economy and the world at large.